Final report released

The Final Report and Executive Summary have now been released.

Read the associated media release:

Message from the Chair

E kore e taea e te whenu kotahi ki te raranga i te whāriki kia mōhio tātou ki ā tatou. Mā te mahi tahi ō ngā whenu, mā te mahi tahi ō ngā kairaranga, ka oti tēnei whariki

Standing alone, a strand of flax cannot achieve but woven together is strong and enduring. Collective efforts often result in more meaningful and sustainable outcomes.

Each thread of our enquiry led us to the view that a more coordinated approach was needed, with Pharmac working in a more integrated way with the health sector. This whakataukī also reflects the coming together of the panel to provide what we hope is a report that will lead to meaningful change.

Every country wrestles with the challenge of funding an ever-increasing array of new and expensive medicines. For 27 years in Aotearoa New Zealand that task has fallen to Pharmac, and with it the responsibility for managing the hugely sensitive trade-offs involved in securing pharmaceuticals for our hospitals, primary healthcare and ultimately patients and consumers.

It has been my privilege to lead the first review of how well Pharmac meets its objective of achieving the best health outcomes for all New Zealanders. It comes at a time when the entire health and disability system is going through the biggest reform in decades. The review has been mindful that its recommendations must support and enable Pharmac to become more closely knitted into this new integrated health system.

Our terms of reference essentially asked us to consider Pharmac’s systems and processes and assess whether they achieve equitable health outcomes for all New Zealanders, but in particular for Māori, Pasifika, disabled people, and other priority populations. All our discussions, observations and recommendations have been considered from an equity perspective.

We spent many hours examining the engine room of Pharmac – the decision-making process it uses to prioritise which medicines to fund. Some of our recommendations will make hard reading, particularly those about improving equity outcomes. The report notes deficiencies in decision-making from the board down and calls for better oversight, better processes and more voices to be heard in deciding which medicines will be funded and for whom.

Coming from a consumer and journalist background but with little knowledge of the health system may have been a blessing because I brought fresh eyes. What I can say is that without the support, commitment, and specialist knowledge of each of the panellists (Sue Crengle, Tristram Ingham, Frank McLaughlin, Heather Simpson and Leanne Te Karu) we could not have completed such a thorough review. In addition, there has been the extraordinary dedication of our secretariat, in particular head of secretariat Sarah Davies, and our tireless consultants Sapere Research Group and Gabrielle Baker.

In recognising that not all medicines can be publicly funded, I hope this report and our recommendations make a difference.

Sue Chetwin, CNZM
Chair

Background

On 2 March 2021 the Government announced that it had commissioned a review of the Pharmaceutical Management Agency, known as Pharmac.

The Review focused on two areas:

  • how well Pharmac performs against its current objectives and whether and how its performance against these could be improved.
  • whether Pharmac’s current objectives maximise its potential to improve health outcomes for all New Zealanders as part of the wider health system, and whether and how these objectives should be changed.

and considered a range of factors, including:

  • the timeliness of Pharmac’s decision making (in particular for new medicines).
  • the transparency and accessibility of decision-making processes.
  • equity, including access to medicines and devices for Māori and Pacific peoples.

The Government has acknowledged that Pharmac is a model that’s critically important to the health sector. However, concerns have been raised about access to new medicines, timeliness of decision making, and the application of criteria that inform Pharmac’s prioritisation and funding decisions. The review looked at these matters.

Within the scope of the review was how Pharmac uses its budget to achieve the best possible outcomes. Out of scope was the fixed nature of the budget and the total amount allocated to pharmaceuticals as these quite rightly are for the Government of the day to determine. See the Terms of Reference for more information.

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